Bad Business

Montgomery County Sheriff's Deputy T. Ward caught the call: deceased person at a residence on Many Oaks Drive, a modest two-story in a quiet subdivision in Spring.

According to his affidavit, Ward arrived at the home shortly before 2 p.m. on February 21, 2011. He was met by Jill Sumstad, who said that she had found her sister-in-law Christie Sumstad's nude body on the bedroom floor. Standing at the door with her was her brother Ryan Sumstad, Christie's husband.

Jill explained that her brother had contacted her earlier that day because he was worried Christie, 34, was suicidal. They had a nasty argument the night before, and Ryan split, leaving Christie home with their three children. The next morning, Christie didn't answer her phone or respond to e-mails, so Ryan asked Jill, who lived nearby, to check on Christie. He had to know if she was okay.

A West Point graduate who played offensive guard on the academy's football team, Ryan Sumstad stood more than six feet tall and weighed around 250 pounds. He had minor scratches on his forehead and an open sore on one hand, which, he told Deputy Ward, he got from punching a wall during his argument with Christie.

The argument had awakened the couple's son in the middle of the night; he'd heard the sound of "yelling and things breaking." The bedroom was "in disarray, with a broken mirror," according to Ward's affidavit.

According to Christie's friends, Ryan Sumstad later told everyone that Christie must have overdosed on sleeping pills chased with wine. Her friends were in shock: After nearly 14 years together, the couple had been considering a divorce, but Christie hadn't appeared despondent.

The day after Christie's body was discovered, Ryan Sumstad, an IT consultant, created a Web site in her memory. He asked that, in lieu of flowers, friends and family donate to his children's college funds. Or, if it was easier, people could just make their checks out directly to him.

Christie's body first went to the Dallas County Medical Examiner's Office for an autopsy, then to a funeral home in Magnolia for visitation.

Several friends who attended found it strange that Sumstad had chosen to dress Christie in a large blue turtleneck sweater, something she'd never have worn. A few were also puzzled by Sumstad's decision to have his wife cremated. But in the face of overwhelming grief, these were insignificant concerns.

Then, on June 20, four months after Christie's death, friends and family received some disturbing news: The Montgomery County District Attorney's Office charged Sumstad with murder. A warrant was issued, and he turned himself in to the Montgomery County Sheriff's Office the following day.

As of mid-August, Sumstad was unable to post a $50,000 bond. Neither his family nor Christie's would help. Nor had the Montgomery County District Attorney's Office presented its case to a grand jury, although prosecutor Joanne Linzer told the Houston Press that they would present their case within the 90 days allowed by statute.

According to a memo written by Montgomery County Attorney David Walker, the justice of the peace for the county's third precinct did not receive a copy of the autopsy report until June 13. Because the investigation is still active, Linzer said she could not discuss the case. So it remains unclear why Montgomery County officials had to wait four months for the autopsy report. It's also unclear when Sumstad became a suspect, or, if he was immediately suspected, why authorities released Christie's body into his custody.

For Christie's friends, the shock of her death was compounded by the possibility that her husband had killed her. And when word leaked out about how the medical examiner's office believed she died, a few of Christie's friends flashed back to that turtleneck Sumstad had dressed her in. According to the arrest warrant, Christie Sumstad had been strangled.

Ryan Sumstad always had grandiose plans, always had a big deal right around the corner, but it wasn't until after he was charged with murder that a few of Christie's friends looked online to see what they could find out about him. And what they found out was that people across the country had accused him of cheating them out of hundreds of thousands of dollars, on sites like Ripoffreport.com.

A closer look by the Houston Press revealed that, over the past four years, Sumstad worked hard to build an impressive online persona, promoting himself as a major venture capitalist, creating phantom companies in order to separate people from their money.

Now Christie's friends and family are waiting to find out from authorities if Sumstad is a simple con man, a cold-blooded killer or both.
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Ryan Sumstad and Christie Mercer met at the military wedding of one of Sumstad's friends at the Woodlands Conference Center. Sum­stad looked resplendent in his dress blues. He caught the eye of one of the waitresses: Christie Mercer, a preacher's daughter and single mom with one daughter. She was a woman who always seemed to put everyone else's needs ahead of hers. She thought Sumstad was brilliant.

They got married in Montgomery County in 1998, and lived in Fort Stewart, in southeast Georgia, where Sumstad was finishing up with the U.S. Army Corps of Engineers. The couple then moved briefly to the San Francisco Bay Area, where Sumstad was born, for Sumstad's new job with a semiconductor manufacturer. After a year with that company, he jumped ship to an IT consulting start-up called All Bases Covered. He was still with that company when the couple moved to Spring in 2001, but before long he quit All Bases and created his own company. (In 2002, All Bases Covered sued Sumstad and his new business partners, accusing them of stealing All Bases' software and client lists. Sumstad and the other defendants denied the claims. The suit was settled out of court.)

Christie's friends who spoke to the Press said Sumstad seemed nice enough, if maybe a little boring. He became excited and confident whenever he spoke about business, but when it came to everyday things, he didn't seem as sure of himself. (Christie's friends would speak only on the condition of anonymity; her family declined to comment for the story.)

By 2002, the couple had two more kids, in addition to Christie's daughter, and, based on Sumstad's blogs, résumés and various self-penned histories of businesses he claimed to have created, it was shortly afterward that Sumstad began envisioning himself as a true entrepreneur. And since a true entrepreneur needs an impressive history, Sumstad began to tweak his background.

In a 2002 résumé, his big accomplishments with the Army Corps of Engineers were bringing a Georgia highway project in before schedule and the project management of a $250,000 office building. But a few years later, he wrote that he "managed troop deployments to the Middle East and Haiti." Moreover, he "maintained a Top Secret clearance while conducting operations with the Rangers."

He would also adjust his résumé to claim that, by 2003, he built his third start-up, which he would ultimately sell for more than $1 million. However, according to the purchase agreement filed with the U.S. Securities and Exchange Commission, Sumstad and his partner sold the company for $20,000 in cash and $136,000 in stock.

In truth, he was good at coming up with ideas; he just couldn't execute them. He and some associates formed a mortgage company that went nowhere; ditto for the Gulf South Community Development Company, which didn't appear to accomplish anything after the initial paperwork was filed with the state.

Meanwhile, he did freelance IT work, and he and Christie constantly depended on direct sales opportunities and credit cards to help make ends meet. Christie sold beauty products; Sumstad at one point became an "independent distributor" of a fruit juice with alleged healing properties that sold for $35 a bottle.

By far, his biggest dream was a company he called IEV ("Insight Energy Ventures"), which was a rebranding of a Woodlands-based Web design company called Apex. Even while he worked for Systems Evolution, the company that bought out his start-up, he was filing IEV paperwork with the state and contemplating a parallel life as a major player in business development. He eventually recruited an old friend named Mark Flynn, and together with the brain trust behind his other go-nowhere endeavors, Sumstad expanded IEV into real estate, oil and gas, health care, venture capital and advertising. Or at least that's how it looked on paper. (Flynn did not respond to multiple requests for comment.)

Now a many-headed creature, IEV only seemed to exacerbate Sumstad's need to be considered an expert in everything. Even as he and Christie slowly maxed out their credit cards, Sumstad dispensed business advice on blogs and issued press releases to business-to-business publications that touted IEV's strengths.

"I'm a 'take the hill' kind of guy — the sort you want in the foxhole with you," Sumstad wrote on his blog. "Over the last 18 years, I've been part of over a dozen startups, acquisitions, and mergers. I've been part of management & leadership in Fortune 500 organizations and 2-person ventures. I have a knack for building and motivating core teams and communicating a clear vision, mission and purpose. My passion has been the key to my successes in business and life."
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While Sumstad honed his image, Christie home-schooled the kids, dabbled in photography and sold her beauty products.

When Christie's oldest daughter took an interest in guitar playing, Christie bought instructional DVDs so they could play together. Her daughter took a special interest in the blues; Christie wrote in an Amazon review that "we both love to write songs and blues just flows so well with the ever-contemplative mind of a teenager."

However, Sumstad's and Christie's relationship wasn't working as well. According to Christie's friends, she complained that Sumstad had a series of affairs. One of Ryan Sumstad's former co-workers backs up the claim.

Angela Denton says she worked with Sumstad at an IT company in 2006. She says Sumstad was well liked and trusted by everyone at their workplace, and describes him as a brandy-and-cigar type of guy who, at least when he was around her, relished acting like a snob.

"He really liked the idea of playing it like he was a millionaire, all the time," Denton says.

Before long, Sumstad and Denton became more than co-workers; they had an affair that lasted four months. Denton says Christie found out afterward. Christie called Denton, furious.

Although Sumstad was highly regarded at work and never displayed any violent tendencies, Denton says she could see how a verbal fight between Christie and her husband could quickly escalate.

"She would ask for it, and he would be more than happy to give it," she says. "...Some women just push the buttons, and she was definitely one of them."

One of Christie's close friends, who asked not to be named, told the Press in an e-mail that the couple "argued a fair amount. He cheated on her a few years ago. And he was constantly worried that she was cheating on him...A couple weeks after her funeral, he even asked me if I thought she was cheating on him. I assured him she had never done such a thing."

Sumstad's father Dennis says the allegations against his son are outrageous.

"It's ludicrous for me to think of somebody as loving and caring and gentle as my son having had anything to do with a murder," he tells the Press. "...He's never had a crime in his life. He's never had anything beyond a parking ticket, you know?"

Christie's friends say Sumstad's relationship with his father was strained. Curiously, Dennis Sumstad says he didn't know his son was charged with murder and sitting in jail until a month and a half after the fact. He says he hasn't visited Sumstad.

He also says he knows nothing about allegations of Sumstad's infidelities or any other discord in the marriage, explaining that "the two of them spent Christmas with us, with the children. And we watched them, laughing and playing with the children and hugging and speaking positively about each other. It was very heartwarming, you know?...There was not any enmity or bad feelings that we could sense."

He adds: "We were cut to the heart by Christie's untimely demise; we're as much bereaved by it as her own parents...We loved the family, we loved the kids and we hope that the truth about the whole thing will come out."

Sumstad's lawyer in Conroe, Stephen Jackson, says the truth will come out, and that it will prove Sumstad's innocence.

"I think when our medical examiner takes a look at it and evaluates it, we're going to see a whole new story...Mr. Sumstad did not kill his wife," Jackson says. "...We're going to be investigating everything in Mr. Sumstad's life, we're going to be investigating everything in his wife's life, to see who might want her dead. Or, if no one killed her, if she caused her own death. We're not ruling anything out at this point."

According to a memo written by Montgomery County Attorney David Walker, Jill Sumstad filed a public information request for Christie's autopsy report on May 12, over a month before Ryan Sumstad was charged. She did not respond to repeated requests for comment.
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By 2008, Sumstad and
Christie twice mortgaged their home and had maxed out their credit cards, according to Sumstad's friend and old West Point roommate Matt Bradshaw.

The couple lived check-to-check, and Bradshaw says he lent Sumstad money just so he could pay whatever IEV employees remained. Bradshaw says Sumstad repaid the loan in monthly installments, and even made a June payment the weekend before he surrendered to Montgomery County authorities.

With the couple in financial freefall, Sumstad ramped an earlier idea into overdrive: In 2007 he had flooded online business-to-business publications with press releases touting IEV's completion of a $1.83 billion venture capital fund. Although it doesn't appear that the fund ever existed, the ubiquitous announcements branded Sumstad as a bigshot. All that was needed was a good idea. And by 2008, he came up with one.

The idea was this: With funds guaranteed from HSBC Bank, IEV would finance owners of land proven rich in gold and silver who didn't have the capital to drill. The owners would repay IEV with the loot they'd pull from the ground.

Of course, IEV would need closing costs from each land owner, ranging from $15,000 to $25,000 a pop — a drop in the bucket compared to the fortune the owners stood to reap. (In a May 2008 letter of intent from Sumstad to a potential borrower — who sat on property valued at $40 billion — Sumstad stated he would offer $300 million in financing; all Sumstad needed was $15,000 to close the deal.)

However, IEV wouldn't be doing the actual lending, nor the servicing of loans. This was to be done by Principal Financial Growth, a company Sumstad created out of thin air. The company's CEO was Sumstad's friend, Bradshaw. While Principal's letterhead claimed the company was in Wilmington, Delaware, all calls were routed to Bradshaw, a pharmaceutical rep living in Victoria.

Bradshaw told the Press that Sumstad
genuinely believed he would get the money from HSBC so he could make everyone
rich off the gold. He wanted to include his West Point buddies, and all Bradshaw
had to do was pretend to be the vice president of a
company that didn't exist.

One investor who asked not to be named said he should have known better,
but "I was really bitten by the bug. We all were...We had gold fever. And we were spending money that we did not have."

At first, Sumstad held regular webinars with borrowers and e-mailed consistently. Then, Sumstad kept pushing back the dates he was supposed to get money from HSBC, and the webinars and correspondence grew sparse. When the borrowers got jumpy, they demanded Sumstad show them proof that HSBC had committed to the funds. Sumstad first declined, on grounds of confidentiality, and then he just didn't respond. Based on correspondence obtained by the Press, Sumstad cut off all contact with the borrowers in December 2008.

By January 2009, three business partners who had been brokering deals between land owners and IEV/Principal were livid: They e-mailed Sumstad and all borrowers, stating they had "offered Mr. Sumstad every opportunity to document and substantiate his claims...Mr. Sumstad has repeatedly denied our requests."

Bradshaw says that the whole project fell through because of the market collapse, and that Sumstad never intended to fleece anyone. And he questions the notion that Sumstad made off with hundreds of thousands of dollars, as borrowers have alleged.

"He was not living an opulent lifestyle," Bradshaw says. "...It's kind of like 'Brewster's Millions' — it's kind of hard to blow $400,000 and have nothing to show for it."

Bradshaw points out that, in fact, Sumstad "has minus to show for it." (In June 2009, Dell Marketing had a $25,000 lien placed on IEV; another IT company, Citrix, placed a $2,700 lien, according to the Harris County District Clerk's records. A month later, Capital One won an $83,000 judgment against Sumstad and a business partner.)

Sumstad blamed the market for the project's failure as well.

Responding in March 2010 to a bitter investor who called Sumstad a crook on Ripoffreport.com, Sumstad wrote: "If you asked anyone who really knows me, they would know that I work very hard to get results.
That I'm giving almost to a fault....I'm not perfect. The stress of having a family and attempting to do
something unique is tremendous." He added, "The American spirit gives us the drive to succeed, but it doesn't come with an unconditional guarantee of success."

He also suggested that, if anyone stole money, it was likely the three partners who'd been brokering the deals. "I have no knowledge of the shell game they may have played," he wrote.

One of those partners was a Florida man named Neal Jacobson. Jacobson shot and killed his wife and twin seven-year-old sons in January 2010. In a letter explaining his actions, Jacobson wrote: "I...believe that much of the correspondence Ryan Sumstad
put out was false and [led] myself and many good people down a dead end path."
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Even before Sumstad's arrest, some of Christie's friends were puzzled by what they thought was strange behavior.

One close friend claims that, a few weeks after the funeral, Sumstad told her "he was going to be saving $5,000 a month now that Christie was gone. I didn't understand what he meant. He told me that she was spending $5,000 a month on her many compulsive shopping trips. I thought that was a very strange way of putting it. I'm all for being optimistic, but there simply is no bright side to your wife dying unexpectedly. Up until then, I wasn't suspicious."

Sumstad, it seems, never missed an opportunity to make a buck. As he was selling off his furniture after Christie's death, one of Christie's friends says, she asked Sumstad if she could have an old, beat-up chair Christie had been in the process of reupholstering. He told her she could have it — for $50.

To his Twitter followers, Sumstad put on a resilient face. Twenty-four days after Christie died, he tweeted, "Let the festivities begin" from his table at Tommy Bahama's Tropical Cafe. He also tweeted that day about his excitement over the launching of the Messenger spacecraft. A week later, he went to Atlanta for InvaderCON, a convention for fans of an animated show called Invader Zim. "Headed home after 48-hrs.of fun, silliness, laughter and DOOM at InvaderCon," Sumstad tweeted.

By April, he was tweeting about happy hour margaritas, "rockin' at the Kemah Boardwalk" and how he preferred traveling with an iPad instead of a laptop. He also sought suggestions for what type of scope was best for hunting elk with a .308. His Twitter account has since been deleted.

Strange things happened even after he went to jail.

According to Christie's friends, Sumstad
granted power of attorney to his friend and former business partner Mark Flynn, who moved into the Sumstad home. (The kids moved in with Christie's mother and stepfather.) Flynn started selling whatever furniture and belongings he could in order to raise money for Sumstad's bail.

When Christie's 17-year-old daughter went to the home to grab some of her things before they could be sold, she discovered Flynn had changed the locks on the door. He was home, Christie's friends say, but would not let her in.

Christie's daughter called the police. Then she waited for the authorities to
let her inside the home where, four months earlier, her mother was found dead on the bedroom floor.